Glossary
Volatility
Markets
Volatility measures how much and how quickly an asset's price moves, usually as the standard deviation of returns.
Historical volatility is computed from past prices; implied volatility is backed out of option prices and reflects expected future movement. Traders more often use the Average True Range (ATR), which expresses recent range in price units and translates directly into stop distances.
Higher volatility means wider stops and, for a fixed cash risk, smaller position sizes. It is a scaling input, not a signal by itself.